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A Journal of Medical Defense

Life Insurance

When you do a Web search for “life insurance CT,” (Connecticut) you’ll have many insurance options to choose from. What you won’t have is a way to calculate how much life insurance you need, so here are a few simple questions to get you started.

Outgoing Resources

What will your family need to pay for after your death? Three rough categories include paying for your funeral service and burial; any outstanding debts (including any medical costs owed after health insurance); and ongoing, day-to-day living expenses such as rent, groceries, transportation, etc.

Incoming Resources

What income sources will be open to your survivors? Is your spouse employed and earning a regular paycheck? Social Security benefits will be immediately available to your spouse if there are dependent children at home. If children are older, however, these benefits are not available until your spouse is in his or her 60s. Group life insurance from the deceased’s company may be another income source. Are there any additional assets or income resources available to your family?

Getting a Rough Estimate

Once you have the answers, subtract the financial needs from income sources immediately available. The resulting figure is a rough idea of how much insurance you need. Now you can search for “life insurance ct” and go from there.

A divorce has many consequences and a life insurance policy is certainly a factor. In addition to any financial and emotional difficulties faced, you made need the help of your Connecticut life insurance company representative to help with special concerns about your coverage. Plans for these changes should begin before your divorce becomes final.

For example, you may wish to revise the selection of life insurance beneficiaries. If you have children, your insurance concerns could center on whether you are granted custody. Often in marriages one spouse will maintain insurance for the entire family, but the breakup of a marriage can obviously have serious insurance consequences for the other spouse, particularly if he or she was not employed outside the home.

Considerations for the custodial parent

In order to protect yourself and your children (if you’re receiving alimony or child support payments), purchasing a life insurance policy on your former spouse might be a wise decision. If you can’t get new insurance on your former spouse, look into having his or her existing policies transferred to you as the new policy owner and beneficiary. This could be agreed on as part of the divorce settlement, just make sure that you’re designated as the outright policy owner or as the irrevocable beneficiary.

Considerations for the noncustodial parent

You’ll likely want to ensure that your children are protected financially even if you don’t have custody. In addition, you also may have responsibilities to your former spouse and can benefit by paying for a new policy on your life for the custodial parent. This will allow you to keep any policies you currently have and protect your children’s future at the same time. The policy can be given to your former spouse free from gift tax if given either before or as part of the divorce agreement.

Change in beneficiaries at divorce

To make changes to the beneficiary on a life insurance policy simply call up the insurer and request the appropriate paperwork. You can designate any person or entity to be the beneficiary, although some states require that the beneficiary have an insurable interest in your life. If a court has ordered, for instance, that you must continue an existing policy with your former spouse as beneficiary, you won’t be able to change it. For questions pertaining to this important life event speak to an agent at your Connecticut life insurance company today.

You probably don’t need much convincing that you should purchase Connecticut life insurance, but there are probably still a lot of questions about which policy is right for you and will best fit your needs, currently and into the future. Obviously, as your situation changes so will your wants and desires as far as life insurance is concerned.

Whether it’s because of your mortgage, a growing family, or other obligations you may have, as you take on new responsibilities, and perhaps your family grows, your life insurance needs can definitely increase. You should therefore periodically review your needs in order to determine if any changes have taken place that affects your situation, in order to ensure that your life insurance coverage adequately reflects your situation as it stands.

Get outlines of life insurance coverage and compare policies

Make sure that you fully understand any life insurance policy you may be considering and that you’re comfortable with the insurer, their licensed representative, and the products and services being offered. Also check that the company is licensed in your state.

Speak to as many life insurance agents as possible to help you to determine who offers a program that is tailored to fit your needs. There are a number of insurance rating services that rate the financial strength of companies, information that can be obtained from your agent or from most public or business libraries. Rating agencies include A.M. Best Company, Standard & Poor’s Insurance Rating Services, Duff & Phelps Inc., and Moody’s Investor Services Inc.

Be truthful when answering all pertinent questions

In order to get the best rates always answer questions about your medical history and health carefully and as truthfully as possible, and be sure to fill out your life insurance application accurately. Make sure that you contact the life insurance company if you don’t receive your policy within 60 days and always check the date the insurance becomes effective.

It’s probably better not to keep Connecticut life insurance policies in your safe deposit box. Remember that, in the event of your death, safe deposit boxes are often temporarily sealed, which will likely cause a delay for the settlement at a time when funds may be needed most.

Make sure that you review your policy periodically or when a major event occurs in your life, such as a birth, marriage, purchasing a home, or in the event of a divorce or remarriage, to be sure your coverage is adequate.